Matrimony is always a cause for celebration, but for those who are entering their second marriage, financial advice for your estate planning can help you avoid a mess of problems later on. Individuals who remarry following a separation often have children and other dependents who are eligible to receive benefits and assets. With proper estate planning, you can itemize assets and assign them to correct beneficiaries, who will receive them upon your death. This can help save your family from the arduous and emotionally draining task of dividing assets in the absence of a will, or estate.
While a second marriage can feel like a fresh start, it’s important to understand how joining your life with another, while also planning for your biological children, can impact your overall financial plan for dependents from your first marriage. Since this scenario is experienced quite commonly, let’s take a look at the complexities of estate planning for second marriages.
Key Considerations For Estate Planning and Second Marriages
There are multiple aspects to consider when estate planning for a second marriage, and you and your new spouse should have a very distinct and clear understanding of both financial sides before starting the planning process. Some key things to consider when evaluating you and your spouse’s assets include:
- Which assets do you wish to leave to children?
- Which assets will you hold together, as well as individually?
- Are you planning to have future children? If so, what assets are designated to them?
- Which of your assets could potentially be retitled in both of your names (homes, bank accounts, stocks)?
- Are there any pre-existing or foreseeable debts on either side?
- Do both of you have a will in place?
- Are you going to establish a new joint will or keep your own?
By considering these questions and thoroughly covering all areas of your finances, both you and your spouse can gain an insight into what needs planning, what doesn’t, and what the best course of action to take will be. These considerations can also help determine whether or not you both wish to sign a prenuptial agreement to protect individual assets. These are often advised for second marriages, especially when certain assets may already be set aside for beneficiaries in a will or living trust.
What is Fair in a Second Marriage and Estate Planning?
In Florida, state law has provisions designed to protect a surviving spouse or second spouse, which override the terms of a person’s estate planning documents (wills, trusts). If you are in a second marriage and wish to protect your assets, children’s inheritance, or any other aspects of an estate, these laws must be addressed in your new second marriage financial planning documents.
How Does the Estate Work in a Second Marriage?
In the state of Florida, the Elective Share law dictates that a surviving spouse is entitled to at least 30% of a deceased spouse’s estate. This can mean anything from property owned individually by the deceased spouse, a revocable trust, or any share of property owned jointly with another person. Under the Elective Share law, the surviving spouse can elect to claim his or her right to this share. To maneuver around this state law, many turn to a premarital agreement. The purpose of this document is for you and your new spouse to waive your rights to an elective share, and other rights created by marriage. However, you can choose to waive some of your rights, which often requires the need of an estate planning service or advisor.
Tips For Estate Planning and Second Marriages
Consider speaking with a professional estate law advisor to cover all details regarding both spouses’ estates. From beneficiary designations, to bank accounts, retirement accounts, property, and other assets, an advisor can create a clear path for you and your spouse while also indicating any gaps in your second marriage financial planning portfolio.
Trusts can also be incredibly beneficial to both sides of a second marriage. Marital trusts, which only come into effect when a spouse dies, can make a huge difference in assuring that all assets are designated properly to both sides, while living trusts can benefit an individual and their rights as well.
Are you in need of a second marriage financial planning advisor? When you work with a Florida estate planning attorney from Walser & Herman Law Firm, you work with an expert who understands that your estate is a reflection of years of hard work, careful planning, and good decisions. Contact us today for any questions or comments regarding our practices, or to schedule a consultation.